2018fy results - anima sgr

2018FY Results

2018… happens

Milan, 27 February 2019

2

2018FY - Table of contents

ANIMA… who01

ANIMA… what02

ANIMA… how much03

ANIMA… why04

3

ANIMA… who

4

Highlights

«new» ANIMA, «old» skills: a problem solver and fee generator, with a distinctive attitude of service company strongly linked to its distributors through long term strategic partnerships

ANIMA: different, yet unique!

*Source: Assogestioni, NNM excluding M&A

+1.0 Net New Money (€bn)

173.1 AuM (€bn)+83% vs. 2017

303.6 Net commissions (€m)+30% vs. 2017

122.1 Net Income (€m)+10% vs. 2017

163.2 Adj. Net Income (€m)+22% vs. 2017

233.1

303.6

2017FY 2018FY

+30.2%

133.8163.2

2017FY 2018FY

+22.0%

Net commissions Adj. Net Income

▶ 2018 FY characterised by:

▶ Resilient flows in a tough macro environment representing ~12% of total Italian industry* NNM (more than 2.5x ANIMA BoP market share BoP of ~4.5%)

▶ Retail margin improving, with overall decline due to large growth in institutional segment volumes

▶ Continued cost control and effective operating leverage

▶ Solid cash generation returned to shareholders through ordinary dividend and buyback totalling more than €100m in 1H2019

5

ANIMA… what

6

BAMI50.8%

BMPS28.8%

CVAL6.3%

BPPB0.8%

86.7%Strategic partners*

Business by segment


Retail Institutional

31% AuM = €53.7bn 69% AuM = €119.4bn

10.9%Wrap#

Source: ANIMA as of 31-Dec-2018 *Includes BMPS, Banco BPM, Cre.Val. and BPPB # Wrap: Anima funds invested by other products managed by Anima

8.7%Otherbanks

4.2%FAs

0.4%Other

61.4%Poste Class I

Insurance

5.4%Poste fundsand U/L

3.7%Funds users/subadvisory

3.1%Pension funds

15.4%Insurance

7

2018FY AuM evolution

Source: ANIMA, data in € bn


0.6440.332

AuM 2017 EoP NNM M&A

-1.795

Mkt effect AuM 2018 EoP

94.398 0.976

79.531 173.110

Institutional

Retail

M&A contribution: BAMI insurance mandates effective from 1st July and Poste Class I mandates from 1st November

Poste Class I

BAMINS

8

Flows vs. industry (Assogestioni reported figures)

Source: Assogestioni, data in € m


2018 was slightly negative due to the anticipated €1.2bn mandate expiration and with the new partnerships yet to be implemented (Alettiacquisition effective December 27th 2017, and insurance mandates only at the beginning of H2)

H2 improving with the industry zeroing, with significant overperformance in September (ANIMA recorded ~¾ of total flows), November (best resultoverall after «red October») and December (positive flows against €1.5bn outflows for the Industry)

Looking at 2018FY, ANIMA flows represent approx12% of total AM flows in Italy, well above (~2.6x) our market share at the beginning of the period

-194

1,354

1,160

9,788

83

9,871

ANIMA ITA Industry

1H18

2H18

2018FY

9

2018FY mutual funds’ flows breakdown by category

Source: NNM in ANIMA mutual funds – data in €m


-1,500

-1,000

-500

0

500

1,000

Cash Bond Balanced Flexible Equity

Also in 2018 the product offering focussed on balanced and flexible funds, with outflows from pure fixed income funds

10

Mutual funds’ investment performance

Source: ANIMA - Bloomberg (FIDMGEND Index for Italian Industry) Source: ANIMA - ASSOGESTIONI for IT Industry funds breakdown by category


2018 monthly ytd WAP

-6.0

-5.0

-4.0

-3.0

-2.0

-1.0

0.0

1.0

AugJan Feb AprMar May JulJun Sep Oct Nov Dec

IT Industry ANIMA

2018 funds’ breakdown by category

39.1% 36.3%

10.3%12.2%

24.8%38.8%

22.2%9.9%

Balanced

ANIMA

Equity

IT Industry

3.6% 2.7%

Flexible

Bond

Cash

11

2018 mutual funds WAP and by category

Source: ANIMA funds and Bloomberg data for Italian Industry index, YTD performance as of 31.12.2018

-4.85 -5.22

ANIMA Industry

-0.79 -0.77

ANIMA Industry

-2.75-3.55

ANIMA Industry

-5.96 -6.30

ANIMA Industry

-5.29 -5.91

ANIMA Industry

-8.81

-11.85

ANIMA Industry

WAP Cash Bond

Balanced Flexible Equity


12

2018 Product innovation: target date funds launches€7.3bn gross flows into new products

FEB‘18

MAR‘18

APR‘18

MAY‘18

JUN‘18

JUL‘18

AUG‘18

SEP‘18

OCT‘18

NOV‘18

DEC‘18

JAN‘18

JAN‘19

MULTISTRATEGY

GROSS FLOWS

€3.4bn

INCOME

GROSS FLOWS

€2.3bn

DEC‘17

THEMATIC

GROSS FLOWS

€1.6bn

SEP-NOV

SEP-DEC

DEC -MAR MAY-JUN JUN-SEP SEP-DEC

OCT-JAN JAN-APR APR-JUL OCT-JAN

MAR-MAY

AnimaGestielleBancoposta

MAY-JUL JUL-OCT OCT-DEC

DEC-JAN APR-MAY AUG-SEPT NOV-DEC

NOV-FEB FEB-MAY JUL-OCT OCT-JAN

JAN-MAR

MAR-APR JUN-SEP NOV-JAN

Source: ANIMA target date funds scheduling for 2018


DEC-MAR

DEC-MAR

€1.6bn€1.6bn€1.3bn€2.7bn

13

What’s next? 2019 product and investment strategy


NEW TARGET DATE FUNDSAUTOMATIC SWITCHES DOLLAR-COST AVERAGING PLANS

Enhancing our product offering looking into new asset classes and investment strategies

Adapting our commercial activity to volatile markets (see box below)

With volatile markets, (especially equities), revamping of products based on the concept of time diversification in terms of product switch, target date funds and “embedded actively managed DCA strategy”

New global flexible bond fund with tactical allocationNew global multi-credit fund in partnership with Legg MasonNew thematic global equity fund linked to demographic trends

RESPONDING TO CAUTIOUS CLIENTS’ BEHAVIORS DUE TO VOLATILE MARKETS

Launch of new target date funds mirroring our open-endedsuccessful strategies (e.g. ANIMA Visconteo) with a time diversification strategy for the equity component

Optional feature to clients for personalised automatic switchesamong funds with different equityexposure

Reducing the risk of entering equitymarkets all at once in the wrongmoment, and actively using thisstrategy leaving PMs some flexibility in accelerating or slowingdown depending on opportunities

1

2

Concentrating in Italy non domestic investment management activities3

14

ANIMA… how much

15

P&L overview

1 2017 figures for ANIMA excluding Aletti Gestielle SGR


€m 2018 20171 %

Net commissions 303.588 233.137

Performance fees 20.318 23.891

Total revenues 323.906 257.028 +26%

Personnel costo/w fixedo/w variable

(41.581)(33.504)

(8.076)

(36.267)(26.173)(10.095)

Other expense (41.829) (29.185)

Total expense (83.410) (65.452)

EBITDA 240.496 191.576 +26%

Non recurring costs (7.881) (9.555)

LTIP expense (3.336) (3.847)

Other income/(cost) 417 6.541

D&A (47.465) (17.983)

EBIT 182.231 166.728 +9%

Net financial charges (8.644) (6.839)

PBT 173.587 159.889 +9%

Income tax (51.530) (48.596)

Net income 122.057 111.293 +10%

Adjusted net income 163.232 133.780 +22%

bps/avg AuM 2018 20171

Retail 30.5 28.5

Institutional 18.7 28.0

Average 24.4 28.3

Cost/income 2018 20171

on total revenues 25.8% 25.5%

ex performance fees 27.5% 28.1%

▶ Strong commitment and consistency in keeping a low cost/income

▶ 2018 Tax rate approx. 30%

▶ Adjusted net income is a good proxy of the cash generated by the Group (as it doesn’t consider non cash-out items net of the fiscal effect such as PPA amortisation and LTIP expense)

▶ Retail margin improving

▶ Large volumes diluting profitability of the institutional business

16

Focus on margin evolution


39.4

53.7

2017 2018

+36.1%

28.5

30.5

26

28

30

32

2017 2018

35.9

119.4

2017 2018

+232.4%28.0

18.7

10

15

20

25

30

2017 2018

48%69%

52%31%

2017 2018

28.3

24.4

18

20

22

24

26

28

30

2017 2018

RE

TA

IL A

UM

IN €

BIN

STIT

UT

ION

AL

AU

M IN

€B

TO

TA

L A

UM

SP

LIT

IN %

▶ Retail margin improved vs. 2017 year-end also through the consolidation of Aletti Gestielleassets

▶ Institutional margin decreasing in FY 2018 mainly due to:

▶ the anticipated loss of the €1.2bn mandate in Q2 (May ‘18)

▶ the €9.4bn AuM insurance mandates (July ‘18) and

▶ the Poste insurance mandates of ca. €70bn AuM with lower profitability (November ‘18)

▶ Average margin trending towards 16/18 bps in 2019E as large institutional volumes linked to 2018 M&A will account for the full year

MA

RG

IN IN

BP

MA

RG

IN IN

BP

MA

RG

IN IN

BP

17

6.2 6.75.7

6.4 6.5 6.85.9

6.9

8.6 8.87.6

8.5

2.52.5

2.5 0.9

2.42.7

2.4

2.6

3.22.1

1.81.1

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

PERSONNEL COSTFixed Variable

52.854.7

52.4 51.9 51.0 52.6 53.3 54.1

70.868.8 70.3 70.8

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

NET COMMISSIONS TREND

Focus on net fees and personnel cost


2016 2017 2018

Total personnel cost down yoy mostly due to lower variable compensationFixed personnel costs reflecting increase in the headcount following integration of Aletti Gestielle and Poste Class I business

2016 2017 2018

New perimeter contributes to increase net commissions2019 shall also benefit of additional net fees for approx. €15m due to the contribution for the full year of 2018 acquisitions

Headcount

246 249

315

18

INTEGRATION

• Headcounts reduction on a Group basis, with physiological turnover absorbing large part of potential redundancies

COST SYNERGIES

• Integration and fine-tuning of investment activities and operations

• Closing of Aletti Gestielle existing rental contracts and concentration of all workforce in ANIMA existing HQ

• Savings arising from single entity: corporate expenses, info providers…

Efficient M&A integration and cost discipline

Aletti Gestielle successfully integrated within 11 months

Even if the target company was already very lean on costs final cost synergies (fully phased-in from 2020 onwards) shall be above €7m (i.e. ~40% of the total cost base of Aletti Gestielle)


Dec 27th, 2017

Dec 1st, 2018

CLOSING OF THE ACQUISITION

FULL PHASE-IN OF COST SYNERGIES

9.4 9.6

8.37.8

8.99.2

8.0

9.09.3 9.3

7.8

5.1

4

6

8

10

12

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

2016 2017 2018

OPERATING EXPENSES (bps)

Dec 31st, 2019

Aug 4th, 2017 ACQUISITION ANNOUNCEMENT

MERGER INTO ANIMA

19

Solid cash generation and consistent delivery


86%80%

92% 91% 94%

14%20%

8% 9% 6%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2014 2015 2016 2017 2018

In the first 5 years as a listed company, consolidated EBITDA grew €73m (+44%), driven by net fees

In the same period, performance fees went down from 14% to 6% of the consolidated total revenues

With performance fees reducing their contribution, increasing net fees and effective operating leverage kept EBITDA margin constantly well above 70%

19

6

23

4

23

3

23

3

30

4

31

57

21 24

20

167

221

191 192

240

0

20

40

60

80

100

120

140

160

180

200

220

240

260

280

300

320

20152014 20172016 2018

Net fees Performance fees EBITDA

€m

Net fees Performance fees EBITDA margin

20

Consolidated net financial position

Source: ANIMA


€m 2018 2017

Bank loan (645.3) (450.0)

Bridge to equity loan - (250.0)

Accrued interest expense - (0.2)

Due to Banco BPM - (113.7)

TOTAL DEBT (645.3) (813.9)

Cash 243.4 359.6

Securities 88.6 150.7

Perf. fee receivable 1.6 27.7

TOTAL CASH & CASH EQUIVALENTS 333.7 537.9

CONSOLIDATED NFP (311.6) (276.0)

333.7

537.9

-645.3

-450.2

-250.0

-113.7

2018 2017

Total cash

Total debt

-311.6

-276.0

▶ Gross debt entirely at Holding level, whereas cash is generated by subsidiaries and moved to the Holdco through dividends

▶ NFP reflects the €120m additional debt for the Poste deal activated at the end of October

▶ Next capital repayment of the bank loan in June 2019 for €50m

at Holding co. level

mainly in subsidiaries, including regulatory

capital

--- Bridge to equity loan

--- Due to Banco BPM

21

43

185 193

-276 -312

2014 2015 2016 2017 2018

Returning capital to shareholders


CONSOLIDATED NFP ORDINARY DIVIDEND

Dividend always kept minimum of 50% of reported net income, notwithstanding releveraging for M&A in 2017/18

In addition to ordinary dividends, execution of a first tranche of buy back in 2019 up to 3% of the issued share capital to be completed before May 2019

In the first months of 2019 ANIMA shall therefore return more than €100m to shareholders between ordinary dividends (~€61m) and buyback (~€40m)

In the first 5 years as a listed company, ANIMA returned €320m through ordinary dividends on an average market cap in the period* of €1.76bn

5075 75

59 6150

125

200

259

320

2014 2015 2016 2017 2018

Dividend €m Cumulated dividends €m

*Source: ANIMA based on Bloomberg §Proposal to the AGM of €0.165DPS, amount in €m net of 3% treasury shares forecast for payment in May 2019

§

22

ANIMA… why

23

Closing remarks (1/3)2018 produced quite a bit of negative headlines…

Uncertainty especially linked to global macro

and political environment

2018 will be remembered as the worst year

for quite all asset classes in the past decade

with increased volatility

Asset management industry slowed down

globally, including Italy (total NNM €10bn,

with H2 close to zero)

2018 is not the end of the world as we know

it, as it wasn’t 2008 either…


Italian political situation and the long debate

with EU on budget law weighted on Italian listed

companies, particularly on the financial sector

First year of negative returns for ANIMA funds,

even if consistently above the Italian industry in

each of the major categories

ANIMA NNM is the lowest since our 2014 IPO,

but represents 2.6x our market share in Italy at

the end of the previous year with very a robust

increase in H2

2018 will not be recorded as our best year, with

main P&L figures well away from their potential

For markets and the AM industry…. …and what about ANIMA?

24

Closing remarks (2/3)Not all that stays in the shadow can’t glitter …


▶ 2019 is expected to be still complicated and volatile due to an uncertain macro and political scenario

both domestic and globally

▶ Italy is facing a slowdown in growth but remains a very attractive market… thanks to a large amount of

financial wealth with a significant pool of liquidity on current accounts reaching the record amount of

€1.4 trillion (representing 32% of total households’ financial wealth)

▶ Preference for financial products is at the highest level in the past few years

-6%

-4%

-2%

0%

2%

4%

6%

8%

3,200

3,600

4,000

4,400

20

06

20

07

20

08

20

09

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

1H

18

Stock % chg

0

5

10

15

20

25

30

1H

12

2H

12

1H

13

2H

13

1H

14

2H

14

1H

15

2H

15

1H

16

2H

16

1H

17

2H

17

1H

18

2H

18

Deposits Financial assets Real estate

FINANCIAL WEALTH ITALIAN HOUSEHOLDS PREFERENCE FOR INVESTMENTS

Source: ANIMA based on Bank of Italy data Source: Survey GfK Eurisko / ANIMA

€m %

25

Closing remarks (3/3)We might sound boring but…


▶ What’s next? This year we plan to keep growing in line with our strategic drivers:

ORGANIC GROWTH will come from further strengthening of our partnerships, including the new ones

in the insurance field that still need to ramp up according to their potential

COST CONTROL is well embedded in our company culture and it’s the ultimate measurement to

evaluate if the growth is healthy and value creating for all stakeholders

CASH GENERATION remains the main feature for the sector and even more for our company due to the

very high level of efficiency; we will keep evaluating the best possible use (and return) of cash

…and, possibly

M&A, aimed at:

• enlarging the distribution network,

• increasing capabilities (in particular in the landscape of alternatives)

…always improving scale economies and keeping in mind that “it takes two to tango”

26

Anima Holding spaCorso Garibaldi, 99

I – 20121 Milanowww.animaholding.it

Investor RelationsFabrizio Armone

Tel. [email protected]

These slides have been prepared by Anima Holding S.p.A. (“Anima”, the “Company” and together with its subsidiaries the “Group”), solely for a presentation to investors. These slides are being shown for information purposes and neither this document norany copy thereof may be reproduced, further distributed to any other person or published, in whole or in part, for any purpose. The information contained in this document (“Information”) has been provided by the Company or obtained from publiclyavailable sources and has not been independently verified. None of the Company or any of their respective affiliates, directors, officers, advisers, agents or employees, nor any other person make any representation or warranty, express or implied, as to,and no reliance should be placed on, the fairness, accuracy, materiality, completeness or correctness of the Information or any opinions contained herein. This presentation may contain financial information and/or operating data and/or marketinformation regarding the business, assets and liabilities of the Company and its consolidated subsidiaries and the results of operations and markets in which the Company and its consolidated subsidiaries are active. Such financial information may nothave been audited, reviewed or verified by any independent accounting firm and/or such operating or market information may be based on management estimates or on reports prepared by third parties which neither the Company nor the Banks haveindependently verified. It is not the intention of the Company to provide, and you may not rely on these materials as providing, a complete or comprehensive analysis of the Company’s financial or trading position or prospects. This presentation speaks asof its date and will not be updated. The Information included in this presentation may be subject to updating, completion, revision and amendment and such Information may change materially without notice. No person is under any obligation to update orkeep current the Information contained in this presentation and any estimates, opinions and projections expressed relating thereto are subject to change without notice. Neither the Company nor any of their respective affiliates, directors, officers,advisers, agents or employees, nor any other person shall have any liability whatsoever (in negligence or otherwise) for any loss howsoever arising from any use of these materials or its contents or otherwise arising in connection with this presentation.

This document includes forward-looking statements which include statements regarding ANIMA’s business strategy, financial condition, results of operations and market data, as well as other statements that are not historical facts. By their nature,forward-looking statements are subject to numerous factors, risks and uncertainties that could cause actual outcomes and results to be materially different from those projected. Readers are cautioned not to place undue reliance on these forward-lookingstatements. Except for any ongoing obligation to disclose material information as required by the relevant regulations, ANIMA does not have any intention or obligation to publicly update or revise any forward-looking statements after ANIMA distributesthis document, whether to reflect any future events or circumstances or otherwise.

Any projections, estimates, forecasts, targets, prospects, returns and/or opinions contained in this presentation involve elements of subjective judgment and analysis and are based upon the best judgment of the Company as of the date of this presentation.No representation or warranty is given as to the achievement or reasonableness of, and no reliance should be placed on, any valuations, forecasts, estimates, opinions and projections contained in this presentation. In all cases, recipients should conducttheir own investigation and analysis on the Company and the Information contained in this presentation.

Forward-looking statements concern future circumstances and results and other statements that are not historical facts, sometimes identified by the words “believes”, “expects”, “predicts”, “intends”, “projects”, “plans”, “estimates”, “aims”, “foresees”,“anticipates”, “targets”, and similar expressions.

A multitude of factors can cause actual events to differ significantly from any anticipated development. Forward-looking statements contained in this presentation regarding past trends or activities should not be taken as a representation that such trendsor activities will continue in the future. No one undertakes any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. You should not place undue reliance on forward-lookingstatements, which speak only as of the date of this presentation and are subject to change without notice.

This document does not contain or constitute an offer of, or the solicitation of an offer to buy, securities, nor will there be any sale of securities referred to in this announcement, in any jurisdiction, including the United States, Australia, Canada orJapan in which such offer, solicitation or sale is not permitted or would require the approval of local authorities. The securities referred to herein may not be offered or sold in the United States unless registered under the U.S. Securities Act of 1933,as amended (the “Securities Act”) or offered in a transaction exempt from, or not subject to, the registration requirements of the Securities Act. The securities referred to herein have not been and will not be registered under the Securities Act orunder the applicable securities laws of Australia, Canada or Japan. There will be no public offer of the securities in the United States, Australia, Canada or Japan and Anima does not intend to register any portion of the offering of securities in theUnited States. Any public offering will be conducted in Italy pursuant to a prospectus, duly authorized by the Commissione Nazionale per le Società e la Borsa (“Consob”) in accordance with applicable regulations. Neither this document nor any partof it nor the fact of its distribution may form the basis of, or be relied on in connection with, any contract or investment decision in relation thereto.

Disclaimer and safe harbor statements

2018fy results - anima sgr

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